LONDON • The cost of borrowing to buy commercial property in Britain is rising and the amount of credit that lenders, particularly from North America, are willing to advance is falling as concerns about property values grow, according to a survey of 78 lenders by De Montfort University.

Lenders have grown more cautious about advancing credit as prices remain near record highs even after Britain voted to leave the European Union, the poll shows. Potential interest rate rises, Brexit and market fundamentals all worry banks from North America, according to the survey.

A surge in spending by Hong Kong-based investors has also reduced demand for credit from UK-based lenders as many Asian buyers finance deals through domestic banking relationships not captured by the survey, said Ms Nicole Lux, a senior research fellow at the university in Leicester, who wrote the report.

North American banks advanced £652 million (S$1.17 billion) for commercial real estate in the six months through June, a 58 per cent fall from a year earlier.

"There is definitely more caution around property values," Ms Lux said. Loan-to-value ratios "could quickly rise if prices fall".

The average interest-rate margin charged for loans secured against the best UK offices was 209 basis points in the first half, up from 191 basis points a year earlier, according to the poll. A basis point is 0.01 per cent. Average loan-to-value ratios fell one percentage point to 58 per cent.

The volume of new lending fell 18 per cent to £17.7 billion in the first half from a year earlier, the survey found. That contrasts with a 3.6 per cent rise in spending on UK commercial property in the same period, according to data compiled by Savills.

British banks and member-owned lenders lent £8.1 billion for commercial property in the first half, down 14 per cent from a year earlier.

BLOOMBERG